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Earnings Season Winners and Losers

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    Christine Short, S&P Capital IQ senior manager, breaks down second-quarter earnings reports.

  • Duration 3:18
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All right thanks so much so more than two thirds of companies have already reported second quarter earnings of who's beaten the street -- who's fallen flat.

Christine -- a senior manager Bassam IQ global markets intelligence.

NG joins me now with the scorecard -- I want it to the winners and losers and then we'll talk about what it tells us overall so let's start with the winners right now among the sectors industrials are one.

Absolutely industrials are biggest leader so far in the second quarter.

They're expected to be up about 14% when it's all said and done.

Right now that's what they're blended growth rate is and that of course is followed by eight and information technology.

They're up about 6%.

At this point in the season of course industrials right now being led by the equipment and machinery.

As well as the professional services industries and -- no surprise that computers and peripherals are really driving that overall growth rate in that sector.

A -- it looks look at the losers commodity is leading the way.

That's right -- really commodity driven sectors such as materials and energy are the ones that are the biggest losers this season.

We see materials are down about 16% at this point.

Energy down about 12% that -- both led by lower your -- costs of commodities.

Although as you look the big picture of earnings this quarter do you think essentially -- it is going to be pretty flat what does that say about the economy.

That's right -- -- a couple weeks ago I can't you know.

Right now the S&P capital IQ growth expectation at that point 4% so like you said pretty much flat.

A bit disappointing but if we looked over the last couple weeks we were expected to be down 2% one point -- at least it's ticked up over to the positive side.

We do expect and earning season -- finished will be just under 1%.

-- for the final second quarter growth rate.

I think it just shows an overall slowing I'm I'm you know it's no surprise that all the negative data that we've seen with ISM negative numbers on Wednesday and although nonfarm payrolls did come in above expected today that unemployment rate -- -- up.

And of course a big theme we're seeing of course is the impact of Europe and companies just not being able to get as many sales and -- and.

And there's -- a disconnect between revenue and earnings to write what does that tell you.

Well right now we have about 64% of companies that have beat earnings expectations.

But were really suffering on the top line only 40% of companies have -- revenue expectations.

So we're seeing as -- companies can of course continue to cost cut either running pretty lean right now so it's going to be harder and harder for them to trim the fat off there.

They're just not growing on the top line you know of course if we're expecting.

The second half -- the year to be successful at all and to grow bottom -- they're gonna have to at some point grow revenues in the outlooks aren't great either.

No -- originally second quarter was supposed to be the weakest quarter of the year but if we look ahead to the third quarter now analysts expecting for.

Growth to be down one point 25%.

Fourth quarter still holding -- pretty strongly about ten and half percent but of.

Dan we've really seen analysts cut those estimates for the fourth quarter at one point there were 16%.

Our down about ten a half percent so we're expecting the second half of the year to be a bit weaker than originally expected in the beginning of the year.

Not good news for great analysis Christine thanks for joining us thank you so much talk about a number cruncher yeah -- already returned.

-- American chemical giant --

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